The federal government will use an extra $230 million in homelessness funding to encourage the states to better target people who most need help.
Social Services Minister Scott Morrison says the extra two years of funding, announced on Monday, will give the Commonwealth time to work with the states and territories to review where the responsibility for homeless services lies.
"It's principally a state responsibility but this enables us to add serious value and use some national focus to priorities on domestic violence," he told Sky News.
Mr Morrison said spending under the former Labor government was "very woolly" with money not necessarily getting to where it was most needed.
As well as helping women and children made homeless from domestic violence, the federal government wants a focus on youth homelessness.
"We need to add value, not just shovel money out the door ... and the states just spent it wherever they wanted to," Mr Morrison said.
The peak body for homelessness services said its members were relieved to see the end of uncertainty around funding.
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